Insurance Law

INFORMATIONAL MEMORANDUM

OIR-07-14M

ISSUED September 14, 2007

Florida Office of Insurance Regulation

The purpose of this memorandum is to remind all personal residential property insurers of the requirements stated in Section 27.711, Florida Statutes; that the insurer shall clearly notify, on a form prescribed by the Office of Insurance Regulation (Office), the applicant or policyholder of any personal lines residential property insurance policy, at the time of issuance of the policy and at each renewal, of the availability of mitigation discounts/credits to reduce the amountof loss in a windstorm that can be or have been installed or implemented. During the June 12, 2007 Financial Services Commission (FSC) meeting the FSC approved form OIR-B1-1655 “Notice of Premium Discounts for Hurricane Loss Mitigation,” (Rev. 07/07) effective September 5, 2007. This form requires insurers to estimate credits/discounts as a percent and dollar amount that the policyholder may receive off of the wind portion of their premium for wind loss mitigation features that can be or have been installed or implemented on the policyholder’s home. Form OIR-B1-1655 (Rev. 07/07) should also reflect the latest approved credits/discounts pursuant to Section 69O-170.017, Florida Administrative Code (F.A.C.). This form must be sent to all policyholders, for both new and renewed policies, effective September 5, 2007. Any personal residential property insurer that fails to comply with Section 627.711, Florida Statutes, is subject to administrative action and fines.If you have any questions regarding this memorandum, please contact Mike Milnes, Deputy Director, Property and Casualty Product Review, Florida Office of Insurance Regulation at Michael.Milnes@fldfs.com or (850) 413-5306.

Law Creating Program

Section 215.5586, Florida Statutes As Most Recently Amended (by HB 7057, passed by the Florida Legislature May 4, 2007)

215.5586 My Safe Florida Home Program.--There is established within the Department of Financial Services the My Safe Florida Program. The department shall provide fiscal accountability, contract management, and strategic leadership for the program, consistent with this section. This section does not create an entitlement for property owners or obligate the state in any way to fund the inspection or retrofitting of residential property in this state. Implementation of this program is subject to annual legislative appropriations. It is the intent of the Legislature that the My Safe Florida Home Program provide inspections for at least 400,000 site-built, single-family, residential properties and provide grants to at least 35,000 applicants before June 30, 2009. The program shall develop and implement a comprehensive and coordinated approach for hurricane damage mitigation that shall include the following:

(1) HURRICANE MITIGATION INSPECTIONS.--

(a) Free home-retrofit inspections of site-built, single- family, residential property shall be offered throughout the state to determine what mitigation measures are needed, what insurance premium discounts may be available, and what improvements to existing residential properties are needed to reduce the property's vulnerability to hurricane damage. The Department of Financial Services shall contract with wind certification entities to provide free hurricane mitigation inspections. The inspections provided to homeowners, at a minimum, must include:

1. A home inspection and report that summarizes the results and identifies recommended improvements a homeowner may take to mitigate hurricane damage.

2. A range of cost estimates regarding the recommended mitigation improvements.

3. Insurer-specific information regarding premium discounts correlated to the current mitigation features and the recommended mitigation improvements identified by the inspection.

4. A hurricane resistance rating scale specifying the home's current as well as projected wind resistance capabilities. As soon as practical, the rating scale must be the uniform home grading scale adopted by the Financial Services Commission pursuant to s. 40 of chapter 2007-1, Laws of Florida.